Klaas Baks

Professor in the Practice of Finance; Executive Director, Center for Alternative Investments Emory University, Goizueta Business School

  • Atlanta GA

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Biography

Klaas P. Baks PhD is a recognized thought-leader in the alternative investments industry. The combination of cutting-edge academic insights and leading industry practices forms the foundation of his investment ideas and research. An award-winning professor and a frequent speaker on topics related to alternative investments, investing and entrepreneurship, he is known for a unique ability to combine original and useful business content with an engaging and dynamic speaking style.

Dr. Baks is the Executive Director and Co-Founder of the Emory Center for Alternative Investments and a Professor in the Practice of Finance at Emory University’s Goizueta Business School. The Emory Center for Alternative Investments is a global leader in the alternative investments industry.

Dr. Baks's research and teaching focuses on issues in alternative investments, entrepreneurial finance and investment management, and he has published papers in numerous academic and business journals, including the Wall Street Journal. He has been recognized by students and alumni with nine awards, including the Marc F. Adler Prize for Teaching Excellence awarded by alumni, the Donald R. Keough Award for Excellence, and the university's highest award for teaching excellence, the Emory Williams Distinguished Teaching Award.

Dr. Baks serves as director or advisor for over 13 companies and investment funds with over $1.5 billion in assets under management, including Anghami (NASDAQ: ANGH), International Media Acquisition Corporation (NASDAQ: IMAQ), Angel Oak Capital and Peachtree Group. An active member of the Atlanta community, Dr. Baks serves on the board of the Michael C. Carlos Museum and is a former member of the Investment Committee of the Westminster Schools Board of Trustees.

Prior to joining Emory University Dr. Baks held positions at Fuji Bank in Tokyo, Japan, Deutsche Bank in Hong Kong and the International Monetary Fund in Washington DC.

Dr. Baks studied at the Wharton School at the University of Pennsylvania (PhD in Finance), Brown University (Master's in Economics), Groningen University (Master's in Econometrics, cum laude) and Leiden University (Diploma in Japanese Language and Business Studies). He spent two years at Harvard University as part of his doctoral research at Wharton.

Born and raised in the Netherlands, Dr. Baks resides with his wife and son in Atlanta, Georgia.

Education

The Wharton School, University of Pennsylvania

PhD

Finance

2002

Brown University

MA

Economics

1997

Groningen University

MSc

Econometrics & Statistics

1995

Areas of Expertise

Alternative Investments
Private Equity
Entrepreneurship
Investment Banking
Mergers & Acquisitions
Strategy
Business Valuation
Venture Capital
Asset Allocation and Portfolio Management
Investment Management
Business Development

Publications

Should Investors Avoid All Actively Managed Mutual Funds? A Study in Bayesian Performance Evaluation

The Journal of Finance

2011

This paper analyzes mutual-fund performance from an investor’s perspective. We study the portfolio-choice problem for a mean-variance investor choosing among a risk-free asset, index funds, and actively managed mutual funds. To solve this problem, we employ a Bayesian method of performance evaluation; a key innova- tion in our approach is the development of a flexible set of prior beliefs about managerial skill. We then apply our methodology to a sample of 1,437 mutual funds. We find that some extremely skeptical prior beliefs nevertheless lead to economically significant allocations to active managers.

The importance of analysts vs. brokers in the performance of stock recommendations

Brokers in the Performance of Stock Recommendations

2007

We analyze who plays a more important role in the success of a stock recommendation: the analyst or the brokerage firm that employs the analyst. Using a Bayesian methodology that models abnormal performance as the output of a Cobb-Douglas production function with analyst and broker inputs, we find evidence that the brokerage firm drives the announcement effect while the skill of the analyst ultimately determines the long-run success of a recommendation. Top-performing analysts who switch brokerage firms are likely to maintain their strong track records. Similarly, analysts who perform poorly continue to do so regardless of their employers. Our results hold over the sub-sample periods that surround the sell-side analyst reforms of 2002.

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Fund managers who take big bets: Skilled or overconfident

Social Sciences Research Network

2007

We document a positive relation between mutual fund performance and managers' willingness to take big bets in a relatively small number of stocks. Focused managers outperform their more broadly diversified counterparts by approximately 30 basis points per month, or roughly 4% annualized. The results hold for mimicking portfolios based on fund holdings as well as when returns are measured net of expenses. Concentrated managers outperform precisely because their big bets outperform the top holdings of more diversified funds. The evidence suggests that investors may enhance performance by diversifying across focused managers rather than by investing in highly diversified funds.

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Research Spotlight

1 min

Are alternative investments right for the average person?

Given the risk, alternative investments were once considered only appropriate for the affluent and institutional investors. However, investment firms increasingly are offering alternative investment products, including mutual funds, ETFs, and private equity funds with strategies similar to hedge funds, to less affluent people. While average investors are responding eagerly to the move and forking over billions for alternative offerings, there are critics who argue that nontraditional assets are simply too risky for them. In a news article, Klaas Baks, associate professor in the practice of finance and executive director of the Center for Alternative Investment at Goizueta, offered his support of the investment strategy, while George Papadopoulos, a fee-only wealth manager, cautioned against it. Baks noted that alternative vehicles allow less affluent individuals to diversify their portfolios. Alternative investments also require minimal initial investment. Papadopoulos wrote that the risk and fees, as well as a lack of transparency and liquidity, were reasons to avoid nontraditional assets. In the article, Baks contended that all investments offer some risk but that alternative investments, when used correctly, also provide critical access to leverage. Source:

Klaas Baks

In the News

Startups Are Booming — but So Are Bankruptcies

Inc  

2024-08-22

Bankruptcies of VC-backed startups rose nearly 60 percent in Q1 of this year, according to data from Carta.

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Concentrated Funds: What Investors Should Know

Investopedia  online

2016-05-18

Managers of concentrated funds have outperformed the main holdings in larger traditional funds because the stocks they bet on have outperformed those key holdings more the more broadly diversified fund group.

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Bill Gross and the dying breed of mutual fund superstars

Investment News  online

2014-09-27

"Celebrity sells. And it can sell mutual funds as well as it sells sneakers.”

Professor Baks is featured in this article by Investment News.

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